Managing director Jim Edgar and finance director Jonathan Briant secured the £11m investment package through UK-based equity investor Mobeus, buying out majority shareholder and founder Adrian Teulon and US-based digital imaging manufacturer Noritsu, which had held a 25.1% share in the business since 2009, as part of a partnership agreement.
Following the deal, management controls more than 50% of the business.
Traditionally a technical support services outsourcing partner for photolabs such as Agfa and Fujifilm, Veritek has diversified since 2006 into the healthcare, ophthalmic, digital cinema markets and graphics arts markets. Under the latter, the business offers technical and ongoing support for CTP, digital, inkjet and wide-format equipment, signing deals in the past year with Epson UK for wide-format servicing, MGI and HP on its Scitex range.
The £25m-turnover company was founded by Teulon in 1985 as Complete Minilab Services (CMS), but was rebranded as Veritek in 2010, around three years after Edgar and Briant joined the firm.
Now employing more than 300 engineers, Veritek, winner of a Queen’s Award for Enterprise in 2012, has expanded to operate across 10 European territories.
Briant said that the interest-only repayment debt and equity investment from Mobeus meant that the business could focus on future growth from a solid financial position.
"Since Jim and I joined we have diversified the business into new sectors and we have expanded our reach across Europe. Although we are focused on five key areas we are open to opportunities in other markets and we are interested in the digital signage and security printing environments," he added.
"We signed a pan-European contract with HP Graphic at the beginning of this year and that is very significant for us. It is a new relationship and one that we anticipate will grow over the next few years so that we become a much more significant partner for them.
"Our business model means we have engineers all over Europe who can respond quickly and efficiently. We have economies of scale that mean we can provide services faster and cheaper than many others."
Of Veritek’s 300-strong workforce, around 200 are UK-based with the remainder covering the rest of Europe.
Briant said that the company was considering expanding its workforce in the coming months to focus on business development in the UK and Europe. "We are looking at winning some major contracts so it makes sense for us to add resources, once we understand where we can best add value."
He added that the business hoped to grow annual turnover over the next three to five years by up to £20m, to £45m per year.
"We made this investment because we believe in the business. We are not tied to just one manufacturer or service and each sector we cover contributes to the others. The company has done well to diversify and we believe it has an incredibly positive future."
Of the MBO funding package, Mobeus investment director Chris Price said: "Veritek is a superbly managed business with an exciting future ahead of it as it increasingly diversifies its business into areas such as healthcare and graphics.
"We are confident that our flexible debt and equity solution will enable the team to take advantage of these growth opportunities and enable Veritek to become the leading service and maintenance supplier to the European imaging market."
